Heading towards the worst month in the nursery since 2009. Will it change after the election?

We’ve done a lot of waiting and seeing in Zimbabwe but this is arguable the most crucial one. There’s a general and presidential election on the 30th of this month and the outcome really will define the foreseeable future of the country.

After a slow start the campaign for all concerned has got into high gear. Trees, lampposts and walls everywhere are festooned with posters for the hopefuls – and there are many of them. Not surprisingly politics is seen as the path to easy wealth and everyone wants a share. By far the most expensive campaign has been by the incumbent party (ZANU-PF) and the current president E.D. Mnangagwa who is usually just known as ED. His visage is on billboards throughout Harare often with the slogan “Zimbabwe is open for business”. Indeed, he has been saying all the right things that might interest investors including scrapping the 51% indigenous ownership of foreign based companies, compensation for commercial farmers (mainly white) who were kicked off their farms by the Mugabe regime and a free and fair election. Anyone is welcome to come and observe the elections and indeed on Wednesday I saw an EU observer team vehicle parked in town. ED has come across so far as supremely confident that he and his party will win the election without any obvious subterfuge. The key word of course is obvious because, as always in Zimbabwe, all is not as it seems.

The Zimbabwe Electoral Commission (ZEC) which is responsible for organizing all aspects of the election is most certainly partisan to the ruling ZANU-PF. Among their transgressions have been not releasing an electronic voters’ roll to the opposition parties, not listing presidential candidates in alphabetical order (ED’s name and photo is top thus biasing his chances), making the voting form a double sheet of paper (it should be single) and saying they are not answerable to anyone. The head of the ZEC has also been photographed wearing ED’s trademark Zimbabwe colours scarf and wouldn’t say when the photo was taken. Ghost voters abound on the roll some of whom are evidently the oldest people in the world. Whilst the bio-metric voters roll was put together in a rush and errors were bound to crop up people are wondering if they will be corrected in time for the poll.

The most credible opposition is the MDC Alliance. Once the MDC (Movement for Democratic Change) was a single party but I have lost count of how many factions there now are. For the moment they seem to have patched over their differences and their presidential candidate is one Nelson Chamisa who has impressed me not at all so far. He seems prone to making silly campaign promises such as a high speed train that will link the capital Harare and Bulawayo the second city in the south of the country. Given that is 450km that will make it the fastest train in the world. That aside he has been touring the country and if the pictures are to be believed the stadiums have been packed. The colour of choice for the MDC Alliance is red which does rather remind me of the EFF (Economic Freedom Fighters) party in South Africa which is known for it’s extreme views on taking land without compensation. It’s headed by the firebrand Julius Malema who has a very thin grasp of economics and models himself on the late Hugo Chavez. I hope that the colour is the only thing in common between the MDC and the EFF.

What I have not heard from any political party is any coherent policy to alleviate the critical cash shortage. The head of the central bank has stated that after the election he will flood the country with US dollars to put the black market traders out of business. Quite where the money will come from has not been stated.

The currency black market is flourishing at a level reminiscent of the Zimbabwe dollar days. My friend Shelton, who is also my French teacher, tells me that the currency traders are openly trading in the centre of Harare (he also tells me that the marijuana dealers are also trading openly but that’s another story). There are several rates depending on what is being traded. Bank transfers for US cash commands about 1.8 or more to US$1 cash. Bond notes, the Zimbabwe equivalent to a US dollar but only valid in the country, trade at about 1.6 or 1.7 to US$1 cash. Mobile banking on a cell phone is about the same as a bank transfer. Apparently there is no shortage of of either type of cash which is curious given that it is vanishingly rare in the shops and banks.

About 2 weeks ago a rumour did the rounds suggesting that the central bank was going to start issuing Zimbabwe dollars again. This started panic buying of US dollars cash and the rate, which had been stable for about 8 months, started to run. I wouldn’t be surprised if the rumour was started by those with the cash (both types), who are known to be the political fat cats, to force a run on the rates before the election.

All my accounts, both company and personal, are in US dollars – it says so very clearly at the top. We all know that they are not US dollars as we cannot go to the banks and get any and the “street rate” is fast closing on 1:2. This is going to pose a major problem for whoever wins the election. Zimbabwe imports a lot of goods, mostly from South Africa, and prices have gone up because those who are doing the importing are doing so at inflated rates. I bought a sheet of plywood this week to put in some extra cupboards at the office and it had more than doubled in a year. I paid by debit card so that would go into the seller’s bank account and immediately be registered as US dollars. Assuming that we do revert to “real” US dollars after the election those who have been charging at the street rates stand to have made a lot of money. I deal in seedlings and when the rates started to run towards the end of last year tried to put up my prices. My customers raised merry hell and I had to bring them down again or risk losing customers. That they put up with increasing prices elsewhere for chemicals, hardware and general cost of living didn’t seem to bother them as odd.

The public’s mistrust of the banks and the banking system is profound so that any cash released into the banking system will soon be mopped up by withdrawals that most certainly will not be redeposited and we’ll end up with a cash shortage of the type we’re experiencing now. I don’t see how this can be solved in the short term. The nation has made significant progress towards becoming “cashless” – payments are made using debit cards and a number of mobile phone platforms. As a result I have little need for cash but I would like to have the choice of using it if I want to.

As I write this the election campaigns are running furiously. The incumbent president, ED Mnangagwa, has gone so far as to woo the white electorate with a purpose-designed rally at Borrowdale racecourse in Harare. He must be feeling a bit nervous to go to that effort; there are very few whites left in the country and their vote is all but inconsequential. I predict a close result. Quite what the military, who were instrumental in removing Mugabe from power and installing ED will do if the opposition wins remains to be seen. Will they throw their lot in with the MDC and Nelson Chamisa? They must be only too aware that should the MDC win they and others in ZANU-PF may well be held accountable for their sins in violent election fixing in past elections. As usual, we will wait and see.

It’s been a strange rainy season. The rain has finally petered out and the mornings are crisp (9 degrees in the photo) but the clear April skies have yet to appear. Of course, here in Zimbabwe, we don’t get the autumn colours of the higher latitudes – we have a sub-tropical climate and what colours there are appear with the new leaves in spring.

The rains arrived pretty much on time in the middle of November and then we had 2 very dry months in December and January. The maize in the foreground of the photo above was starting to look stressed and the general manager of ART Farm where the photo was taken was getting distinctly stressed about the state of the soy beans. Then in February the rains came back with a vengeance and by the end we’d had an almost normal quantity. Distribution is important too and because of the prolonged dry spell yields will not be fantastic. Some parts of the country got excessive rain and others did not plant maize at all.

The economy continues to stagnate. This is not that surprising as it is after all broken and broken economies are not quickly fixed. In the case of Zimbabwe we, and presumably potential investors, are waiting for the general elections the date of which still has to be determined. If the elections are deemed to be free and fair then the money will come. We hope.

The elections have to happen before September. I don’t watch television much and local television not at all but even I have noticed a dearth of campaigning by the parties concerned. The opposition MDC alliance (the original MDC became hopelessly divided but they seemed to have cobbled together an agreement to stand as a single party) have been holding rallies which apparently have been well attended but the governing ZANU-PF don’t seem to be doing anything. This has made people very suspicious. Either they are super confident that they don’t need to campaign or they are “up to something”. Their track record favors the latter. Newspapers have reported that the military have been dispersed to the rural areas to do the campaigning but nobody actually seems to have evidence of this.

Mary Chiwenga, the wife of the ex-general and now vice president who was key in deposing Robert Mugabe last November, has been reported as helping herself to a government owned farm recently. This seems at odds with the “new dispensation” of president Emmerson Mnangagwa who has promised compensation to commercial farmers evicted under the Mugabe regime and has appealed for the self-same farmers to come back and help rebuild the economy. This may not sit well with prospective investors who shied away for just this reason; a lack of property rights. The story has faded quickly from the local papers who have a notoriously short attention span. When I told my foreman of this latest land grab he commented that this was a “problem with older men who take younger wives that they cannot control” – a clear reference to the profligate land grabbing antics of former president Robert Mugabe’s wife, Grace.

Yesterday was a public holiday – the holiest of holy – Independence Day. In the past crowds would be bussed, sometimes under duress, into the National Sports Stadium to hear then president Robert Mugabe drone on about perceived injustices the rest of the world was inflicting on us. Sanctions was a favorite culprit for the economic mayhem he’d wreaked even though everyone knew they were targeted sanctions against ruling party (mainly) individuals. The crowd had mainly come for the high profile soccer match afterwards.

Sometimes there was a military display and fly-past by the air force. The jets used to practice their run over my workplace but this year they were absent and I’m not even sure there was any sort of celebration at the National Stadium. This did not stop the local branch of ZANU-PF asking me for a donation for their regional party. In the past there had always been an implicit threat that if I didn’t cough up there might be a consequence – farmers have long been a soft target. It says a bit for the changing political atmosphere that this year I turned them down when phoned with “not this year, I have too many financial problems to deal with”. True enough if a bit overstated; it’s been the worst first 3 months of a year for business since we adopted the US dollar as our currency back in February 2009.

We are so used to hearing about the dire state of our economy that I am often mildly surprised to hear about agricultural enterprises that are doing well. Avocados and macadamias are riding their healthy food status wave and those who can are exporting to a near insatiable Chinese market to the extent that macadamia nuts are nearly impossible to find locally. Another horticultural company that I’ve dealt with in the past exports canned cherry peppers in bulk containers and I know an export agent who is concerned about the vast area of blueberries that will come online in 5 years or so – he told me that we lack the infrastructure to export them!

Export markets are highly sort after as the foreign currency earned can be used to import goods. Unless one has a priority requirement such as medical, seed or some other “essential” service it is nearly impossible to import using local currency. A way around this is to purchase the US dollars cash on the market, take it to the bank who will then effect the importation. This is what I did last year to import the coir pith we use in the nursery as a growing medium. I paid a 40% premium at the time – apparently it is now 50% – and landed the product cheaper from India than I can buy the local equivalent the quality of which I don’t trust.

Medical cannabis is also being grown but is very much a closed market. An email call to someone in the know got me a curt “I’ll contact you when the way forward is clear” reply. I guess I’ll just have to keep looking.

Bob’s birthday celebratory billboard. I had designs on this one but was beaten to it. His glasses are just still visible top right.

It’s been an extraordinary week. Robert Mugabe resigned his presidency at the last moment as a multi-party committee was discussing reasons for his impeachment. Jubilation ran rampant through the country and, here in Harare, people partied for 24 hours straight. They had good reason to – Mugabe had ruled with an iron fist for 37 years and for many people he was the only president they’d known. He tolerated no dissent within or without the party and opponents were eliminated (the Heroes Day public holiday honours list ceased to be shown when it became apparent just how bad drivers many of his opponents were) and freedom of speech existed only in the national constitution. In the end his extreme age and increasingly poor judgement gave his recently fired vice president, Emmerson Mnangagwa, reason to move against him with the assistance of the army who mounted a non-coup (see previous post) and he buckled under the pressure.

Mnangagwa, sometimes known as The Crocodile or just ED, will be sworn in tomorrow as the new president of Zimbabwe. It will be his job to resuscitate the comatose Zimbabwe economy and hopefully bring back a semblance of compliance with the constitution. The first obstacle is a general election that must be held in the first 6 months of next year and already there is speculation about how free and fair it will be for Mnangagwa is the chairman of ZANU-PF, the ruling party that Mugabe claimed as his own over the last 37 years. To assume that the ruling party has any intention of playing free and fair given that they beat and cheated their way to victory in 2008 and 2013 would be naive indeed. The generals who concocted the non-coup that forced Mugabe out will also want their piece of the pie (statesmen they are not) and rewards for the considerable risks they took. We might have decapitated the monster and found a new head but it’s still the same body. A cynical friend commentated that we are just swapping one group of mbhavha (thieves) for another.

One thing the ruling party will need to remember is that the people of Zimbabwe tasted the power of free speech and expression and may not be so subservient as in the past. The street protests of the past Saturday and Tuesday were unprecedented in our history and amazingly peaceful. As one wag put it; “Only in Zimbabwe does the crime rate go down when the crowds protest and the police are locked up” (the military have made sure that the ubiquitous police roadblocks have been absent over the past week). There were no reports of violence or looting – remarkable considering that the crowds in Harare numbered well into the 100,000s. It was of course expedient for the non-coup plotters to approve of the demonstrations to show the world (we were immensely popular on the news channels for the last 10 days) that the population supported them and the social media was completely unfettered. Will this practice continue or will we suffer the same fate as the Egyptian Arab spring of the past where ex-military types are common in the government?

Now that the headaches have faded and sobriety of body and spirit have returned, Zimbabweans are starting to question just how sincere Mnangagwa is. He’s certainly making all the right sounds; “rebuilding” and “servant of the people” appear in the same paragraph but then Mugabe started out well in the 1980s too.

As I was about to leave work this morning a customer walked in. We followed the customary Zimbabwe greeting;

“Good morning, how are you?” he asked.

“I’m fine and how are you?”.

“Oh, so-so” he replied.

“Only so-so? Why is that? Were you just testing to see if I was listening?” I asked surprised.

“No” he responded with a mirthless laugh, “we must be careful we are not getting into more trouble”.

The rains are over for this season and the cosmos (Cosmos bipinnatus) is fading, still attractive but not as flamboyant as 3 weeks ago. We had good rains for once; 1020mm at the nursery which is probably not a record but certainly substantial. The cosmos was just as showy as ever – it doesn’t seem to mind if it’s a drought year or not.

The government press has predictably predicted a “bumper” harvest but that is far from certain as it will be at least another month or more before the crops are in and there is a lot more to farming than a good rainy season. The fall army worm also made an appearance this year. New to Zimbabwe it has a voracious appetite for maize and is difficult to control once the crop gets large so the small scale farmers are likely to have had a hard time.

The current financial crisis continues to deepen. US dollars (cash) are commanding a premium discount with some outlets offering up to 20% off for the greenbacks. Even the much maligned bond notes are becoming scarce but I have yet to get a discount for using them instead of a debit card.

Two weeks ago I finally received a large outstanding payment for a contract of gum trees that we did last year. Normally I would spend it on raw material – the coir pith we favour for propagating seedlings comes from India and is bizarrely about 60% of the cost of the local milled pine bark medium. It’s also reliable quality and we have yet to experience any significant problems with it. Not something we can say for the local product.

I got hold of the business manager at one of the banks I deal with and asked him what the chances were of getting money out to pay for a container of coir pith; all of US$9600 for 24 tonnes delivered to Beira docks in Mozambique. He was direct (I appreciate directness).

“Do you export?” he asked.

“No’

“Have you been depositing US dollars cash into your account?”

Was this a serious question? “No I haven’t”. I was tempted to add “you weren’t expecting me to say yes were you?” but I remained quiet.

“Then no. If you bring us the cash we will make the application to the Reserve Bank”.

Hmm, like anyone trusts them. He went onto assure me that if the request was refused I would get my cash back in US dollars, not bond notes, and that they’d never had an application for a request of this nature turned down.

I should point out that I have never had, to my knowledge, anything but US dollars deposited into my account and here I was being told that in fact the bank did not believe that. It says at the top of my statement that it is a US dollar account – but it’s only useful in Zimbabwe.

When the Reserve Bank announced last year that it was introducing the now notorious bond notes, with a value equivalent to the US dollar, in order to alleviate the cash shortage (true, a lot of cash had disappeared from circulation) the populace panicked. Rumours that it was an attempt to re-introduce the defunct Zimbabwe dollar flourished in the fertile rumour environment and a run on the banks began. People slept on the pavements for cash withdrawals that progressively dwindled to a paltry $30 or less. Yesterday at another of the banks that I use there were people sleeping on the pavement but now it’s for bond notes. Yes, there has been a massive switch to electronic money but some things still require cash. Schools in rural areas, which are cheaper, don’t have bank accounts and unscrupulous landlords demand cash.

The amount of bond notes issued is pitifully small, some $10m to start with and then another 30m or so. That they have been issued entirely in $2 and $5 denominations is telling – it was never intended to do much. $10 and $20 would have had far more impact. Initially the Reserve Bank stated that the bond notes were guaranteed by a loan of $200m from the Afrexim bank in Egypt, but this has been nearly impossible to ascertain. $200 million in a GDP of some $11 bn is not going to do much (see this Forbes article) and anyway, if all that was needed was cash why not just buy it from the USA? We all know the Zimbabwe government is broke so it cannot buy cash. However what could be easier than adding a few zeros to electronic money? Electronic money is not based on anything which is why the bank manager I was talking to wanted to know if I could pay in US cash for the import of raw material. He wanted to know that if his bank were to deplete its precious nostro account (held outside the country) was being backed by real crispies (well, once upon a time they were crisp – long ago) and not some figment of a government official’s imagination. So where does that leave me?

Last Thursday there was a workshop at the Tobacco Research Board (TRB) near the airport. They were promoting the growing of vegetable seedlings. Not much to do with tobacco research to be sure but the seedlings of both crops can be grown in polystyrene trays floating on shallow ponds in which fertilizer has been dissolved. The TRB manufactures the trays, has a local company make up the fertilizer solution and is in a joint venture to manufacture the pine bark based medium in which the seedlings are grown. So they are looking to expand their market. I was concerned that I was going to have a lot of competition for my business. It was time to check out the potential competition and I was also curious to see what the TRB, once a world-renowned research organization, had been doing on vegetable seedling research.

I was not over-awed but I had to admit that their seedling tray quality had improved since I last bought any. The presentations were not very impressive and their idea of seedling quality was lacking some fundamental concepts. Their growing medium appeared to be reasonable quality but was expensive but they were willing to take any sort of money, cash or electronic. I will have to try some.

Logic dictates that if the medium is acceptable that I buy it in bulk with currency that I can only use within the country i.e. my locally held accounts even though it’s relatively expensive. If however the quality is poor then I will have to look at sourcing “real” dollars (anything is possible in Zimbabwe) and getting in the coir pith medium from India that I trust. Quite what I’ll spend my local money on then I really don’t know.

Next Tuesday, 18th April, is our independence day. Two weeks ago, as is customary, I received a letter of request from the local ZANU-PF (ruling party) office asking for donations in “cash or kind” for the celebrations they were going to host where “800” people were expected. It was shoved into the top left drawer of my desk – they would have to ask in person. In the past I have fought with them over this with arguments such as; “Why don’t you go into the shopping centres and ask for donations there?” but they know the white farmers feel vulnerable and are soft targets, so yes I inevitable buckle and donate.

I was driving back from the gym yesterday after lunch when the inevitable call came – they were at my business and what was I going to donate? It certainly was NOT going to be cash so they accepted $100 through mobile banking. I cursed myself for being weak then just consoled myself with the thought that they’d got the least value money option available. It was a cost of staying in business in Zimbabwe.

I usually only buy the newspaper when I need newsprint. It’s useful for mopping up excess oil after frying fish and Marianne had bought some calamari rings for Friday supper.

The Zimbabwe Independent is actually not a bad paper and insofar as I can tell gives a reasonably balanced opinion on the local political situation.

It’s no secret that the Zimbabwe Government is broke so I was more than a bit surprised to see that it had made a substantial bid for a majority shareholding in a local mobile phone company that was going to cost some US$40 million. A bit further down the page one can also read that a civil service audit report has recommended substantial reductions in the wage bill which gobbles some 80% of revenue.

Perhaps the government thinks spending $40 million that it doesn’t have is going to earn enough to avoid laying off large numbers of its supporters. This is unlikely given the appalling record of the government to do anything well except line the pockets of the faithful.

The 11th November came and went with little fanfare in the papers about remembering Armistice Day. In this part of the world it is also known as the anniversary of Ian Smith’s Unilateral Declaration of Independence (UDI) that broke Rhodesia (as Zimbabwe was known) away from British colonial rule. Most years it passes with little if any comment but this year was the 50th anniversary. I must admit I’d forgotten about this until I saw it in the social media.

The state controlled press in the form of The Herald newspaper wasted no time in reporting that “unrepentant Rhodies” in other parts of the world had been celebrating this anniversary (Rhodie is a derogatory term for ex-Rhodesians). One ZANU-PF (ruling party) spokesman, Cde Simon Khaya Moyo (Cde is the abbreviation for “comrade” that only the party faithful and state press use) went so far as to reiterate that “Zimbabwe will never be a colony again”. He was apparently referring to social media posts in Australia advertising celebrations for the 50th UDI anniversary. Quite why he felt threatened by people having a party half the world away is not made clear.

Why anyone would want to celebrate the UDI is beyond me too. I was nearly 6 at the time and almost certainly looking forward to what my parents promised to be my last birthday party in 6 days time. The UDI culminated in a bush war that took my father’s life and very nearly took mine. I most certainly don’t look back on Ian Smith with any fondness even if he was right that the Mugabe regime would ruin the country. He was most certainly wrong to declare UDI but I don’t lose any sleep over it; I have more important things to consider like my birthday in 2 days time and just making ends meet.

I have seen the house that Morgan Tsvangirai bought and I am not pleased. It is a multi-million dollar mansion on Kew drive in Highlands, Harare. As prime minister in the GNU (government of national unity – a contradiction in terms if ever there was one) he simply does not earn that type of money. Even if he did get a mortgage. This does not make me think that if he ever does get into power that the corruption and pillaging of the nation’s resources will stop or even diminish. Yes, at the last election I did vote FOR him and his party, the MDC. At the next one I will vote AGAINST the incumbent, Robert Mugabe, and his party, ZANU-PF.

I was delighted to read in yesterday’s Independent newspaper that the ruling ZANU-PF party is broke. Apparently during this last year 1.6 million membership cards were distributed to the various provinces but only US$675 from their sale was returned to the party’s HQ. Some 500,000 of the cards were given out to “members”. It was not clear how the party will generate funds but it was going to “devise more imaginative ways” to get the cash flowing in the coming year.

The ZANU-PF congress is on at the moment. In years gone by it was held at luxurious hotels around the country but now it is in the headquarters in Harare – which I would think is indicative of their financial woes. I made the mistake of driving past, or at least trying to, this morning when Bob was due to open the “festivities”. Spotting the snarl of traffic ahead I did an illegal U turn and went another way. Quite which parastatal companies coffers have been plundered to put on the congress has not been revealed but there was no shortage of delegates eager to gorge on the spoils.